Reserve – A flexible pool of stablecoins designed to reduce risk

https://reserve.org

by hnuser • 5 years ago

64 118 5 years ago

reserve.org

ignoranceprior• 5 years ago

Oh, is this what Leverage Research turned into? Interesting.

ipsum2• 5 years ago

Interesting. I see some of the same members from that organization, but it doesn't seem strictly related to it?

For context, Leverage Research was this pseudo-science psychology woo/cultish org made by people related to the rationalist movement. See: https://www.lesswrong.com/posts/8j4zirwfhWhT8nwsc/a-critique... for some background.

throwaway4good2• 5 years ago

What is it running on top of (Ethereum, its own blockchain)? Is it similar to MakerDAO?

isaacimagine• 5 years ago

Initially we are developing on the Ethereum Network but ultimately we expect two-way bridges to enable complete interoperability of the Reserve token across all major smart contract platforms.

throwaway4good2• 5 years ago

Then it would be very similar to MakerDAO?

max_• 5 years ago

Its on Ethereum (guessing from the metamask client).

It's nothing fancy its like an SDR for cryptocurrencies[0]

[0] https://en.m.wikipedia.org/wiki/Special_drawing_rights

tornato7• 5 years ago

If it's running on Ethereum then users will see $5-20 transaction fees and >20 second transaction times. That's not a great experience for first time users

fbrusch• 5 years ago

It is now possible to use so called layer 2 (L2) solutions like zkrollups, considerably reducing fees and increasing throughput (https://vitalik.ca/general/2021/01/05/rollup.html). Loopring is already functioning on mainnet. (https://loopring.org)

nathias• 5 years ago

Nice, I hope it gets to the point when it can leave Ethereum.

sneak2• 5 years ago

I'm surprised that being associated with Coinbase (of "we're NOT going to agree that black lives matter, so stop asking already" fame) and the giant scam that is USDT is not regarded yet by these people as reputation damage.

dannyw• 5 years ago

The people calling ‘USDT’ a scam probably haven’t used it. For the past 5 years, Tether has been the most amazing way for me to transfer dollars across exchanges, or just to hold during market drawdowns.

The fact that it is unregulated, and weakly subject to AML/KYC is a feature for me, not a problem. My money, my business, not the governments.

arcticbull15• 5 years ago

No, the people calling USDT a scam know that it's backed by nothing, and Tether has no obligation whatsoever to redeem them, ever (it's in their T&Cs).

Their banking partner, Deltec, in the Bahamas is chaired by the man who created the Inspector Gadget TV series.

[edit] Tethers are chuck-e-cheese tokens that became so integral to the entire cryptocurrency market (90% of ETH inflow and 80% of BTC inflow are Tether, not dollars) that nobody can do anything other than pretend they're legitimate. Because if they're not - and they're not - then the whole thing falls down.

vntok2• 5 years ago

A company wants to focus on their product or service instead of getting entangled into the clown festival of social justice politics, a topic that has nothing to do with said product or service.

Tepix• 5 years ago

I had this rather simple idea the other day: Why not create an artificial index over the last X days and trade that instead? No matter how crazy the price changes of a crypto coin are, the X day average will always be dampened because today's changes will only be 1/X of the change of the average.

Geee2• 5 years ago

That's not a bad idea. Wrap Bitcoin 120 days moving average into a stablecoin. It could probably be done in a decentralized manner similar to MakerDAO/Dai.

iSnow• 5 years ago

Sounds like it would break down real fast if it just says "we track BTC avg over X days" and has no means to defend it.

Consider the following scenario: your index (let's call it BTCEMA) tracks BTC at $30k but BTC does a crypto thing and drops $5k in a day, so it's now below the index. A lot of traders would sell your BTCEMA tokens to buy more real BTC expecting a recovery or get into stable coins expecting a further drop. At any rate, the exchange price of BTCEMA would drop due to sell pressure.

Your indicator has "broken peg" which is an ugly situation that threatens every artificial instrument in that space. The whole miracle mixture for algorithmical and asset-backed stable coins is to prevent such a situation to happen for a longer time. It's a bit too much to explain but they try to defend against this in different ways, e.g. reducing supply to hike price.

In your case, you'd need to buy BTCEMA from the market to prop up price for as long as it takes the moving average to digest the sudden price jump. You'd find yourself in the situation of the Bank of England trying to defend the Pound in 1992 and only making Soros rich instead.

Geee2• 5 years ago

When it removes the peg to the dollar, how it's supposed to be stabilized? "bunch of random collateral" isn't quite convincing. How are people going to trust that the collateral, like tokenized bonds, are actually valuable? I'm not going to trust such a system. Money based on trust is dead.

The only purpose of this currency is to enrich those who invented it.

arcticbull15• 5 years ago

The only purpose of this currency is to enrich those who invented it.

As is tradition in crypto. It's kind of implicit.

[edit] I mean, think about this rationally. You're creating a new token, that doesn't have revenue, a business model, or any way of generating income. And yet it is "100% asset backed, and funded by top Silicon Valley investors."

Those investors aren't in it for their health. They don't care about decentralization and trustless whatever. They want to make an ROI.

How can you make an honest ROI if you don't have income?

vntok2• 5 years ago

How can you make an honest ROI if you don't have income?

This seems like a very curious view of the world to me. Do you believe that people who buy houses and sell them at a profit 20 years later are dishonest?

pmorici2• 5 years ago

I assume these stable coins are making interest off the assets they hold to back the stable coin. Isn’t that the obvious play here?

rglullis19• 5 years ago

On one hand, yes, you are right. This "it's turtles all the way down" approach regarding valuation of tokenized assets is a huge source of systemic risk and those that want to be able to get greenbacks will be better off by using centralized stable tokens (like Circle's USDC or STASIS' EURS)

On the other hand, any project that can be transparent about its reserves (whether though "smart contracts" or plain old armies of bean counters writing actual compliant reports to Uncle Sam) is welcome by my book. Anything that can take the influence and dominance from Tether in the crypto market should be brought to the table and considered for analysis.

The only purpose of this currency is to enrich those who invented it.

Isn't that exactly what's happening with the existing relationship between governments, their central banks and the financial elites?

I'm not a fan of Reserve either, much less of this Silicon Valley idea of governance, but as long as they they make good on their deals and make their money by providing stability in exchange of absorbing risks, I don't see anything immoral or unethical about the fact that private individuals and organizations can go on to try to create an alternative to central banks.

codebolt3• 5 years ago

Remove the unconstrained supply of Mickey Mouse money (Tether) and eliminate wash trading, and you will watch Bitcoin descend into the abyss rather quickly.

gogopuppygogo2• 5 years ago

I want Monero but as a stable coin.

Can someone just bring that out so we can have a crypto currency that is actually useful as a currency?

arcticbull15• 5 years ago

Monero is on its way to being delisted from all exchanges, and outlawed.

CryptoPunk7• 5 years ago

Monero exists in a global market. There are many many exchanges all over the world. On top of that, Monero can be trivially exchanged for other cryptocurrencies without the use of custodial/permissioned exchanges. The cryptocurrency genie is out of its bottle.

bulgar733• 5 years ago

Not all, and if, we also have DEX :)

ajkdhcb2• 5 years ago

Pure propaganda with no evidence. Major exchanges like Kraken are still trading it even in USA.

Even if it were banned it would have little long-term impact. Literally impossible to stop decentralized swaps unless they also cripple BTC. it would be very powerful actually for people to realise how unstoppable it is.

CryptoPunk7• 5 years ago

Well, you don't have to have a standalone coin to get the features you desire. For example the AZTEC Network, which is a privacy protocol, can be used with any Ethereum-based ERC20 token, including algorithmic stablecoins like DAI, and soon Reserve.

A demo a couple years ago showed AZTEC being used to conduct privacy-protected DAI transactions for the first time:

https://twitter.com/avsa/status/1068536063470125056

Since then, AZTEC's privacy technology has become more efficient in terms of gas, and more effective at protecting privacy, going from protecting merely the privacy of amounts, to protecting the privacy of amounts transferred and sending/receiving addresses.

AZTEC is also developing a zk-Rollup, which increases Ethereum's maximum throughput from 15 tps to 3,000 tps, so that these private stablecoin transactions can be done at scale (though not 3,000 tps, since privacy comes with a computational and state storage overhead, but still much greater than 15 tps).

krzkaczor2• 5 years ago

Correction: DAI is not an algorithmic stablecoin. It's backed by collateral of multiple different assets.

https://blog.makerdao.com/busting-makerdao-myths-seven-misco...

bulgar733• 5 years ago

You are wrong. We have one which is what he want !!!

Asset “xUSD” - first and only untraceable private stablecoin in monero based blockchain developed by www.havenprotocol.org team. XUSD was started 07/2020 and soon in 02-03/2021 team also start next four assets - xEUR, xCNY, xGOLD and xSILVER. All in private haven protocol.

ing33k• 5 years ago

/s isn't that Zcash ? the price doesn't change much. /s

Zcash will be adding support for user defined assets. may be some one will create a stable coin based on Zcash using this.

https://github.com/zcash/zcash/issues/830

bulgar733• 5 years ago

Mister, we have “xUSD” !!! It is first and only private untraceable stablecoin math backed on $XHV blockchain which is fork of $XMR. See www.havenprotocol.org

bullterrivel• 5 years ago

Haven Protocol’s xUSD is what your’re looking for. The potential for this one is huge. Just check havenprotocol.org or join the discord server. Very active community and really exciting stuff to come such other xAssets including gold, silver, euro and Chinese yuan, all with Monero tech. Twitter is @HavenXHV. Cheers.

treelovinhippie• 5 years ago

Guarantee they're breaking some rule for listing Sam and others on their website as "investors". If not, that's super dodgy that Coinbase Ventures allows their portfolio companies to do so.

abalaji• 5 years ago

Sounds similar to basis. [1] I wonder how they are going to get around the unregistered security problem.

[1] https://www.basis.io/

ac292• 5 years ago

"Furthermore, the Reserve network is, in a sense, a new kind of government. We are supplementing - and in some cases wholly replacing - the government function of money"

From their Ethics page. Should go over well with regulators.

CryptoPunk7• 5 years ago

Regulators work for us, and should be answerable to the people through their democratically elected representatives. Their job shouldn't be to protect and expand the control the state wields. It should be exclusively to further the public interest, whether that is through expanding state power, or relinquishing it to make way for new non-governmental mechanisms of socio-economic coordination.

I understand your point from a practical perspective, but I think it's important to point out how far the situation of needing to worry about how regulators will react to decentralization technology is from the ideals of democracy.

bastawhiz2• 5 years ago

Crypto-as-money is still young. We have a lot to do. Do you remember Napster? Tether is kinda like Napster – it's taking off, people love it, it's a little sketchy, and it's probably not the design that will last. We don't want to make the equivalent of Kazaa – another blip in the history that ultimately doesn't ultimately work out. The challenge is to build a platform that's as robust as BitTorrent and as great to use as Spotify and Netflix.

For something on an about page, this copy draws some extremely frank comparisons.

If users all have to go through a KYC process, this significantly limits the viability of the token to permit free movement of money across borders.

KYC processes are, essentially, the law. Governments go out of their way to do this to cut down on financial crime. Regardless of whether you believe these laws are useful or just, I find it difficult to believe they'll have any success trying to work around these laws. Governments (in general) do not like it when folks try to create loopholes: I wouldn't bet on a project whose stated goal was to avoid complying with the law.

bouncycastle2• 5 years ago

KYC laws essentially treat everyone like a criminal or a terrorist. They turn our financial institutions into surveillance centers. They are also ineffective, see https://www.regulationasia.com/aml-controls-are-ineffective-....

Meanwhile, the real criminals pass through KYC with stolen ID.

ddon• 5 years ago

totally agree.. once my account on Revolut was blocked, without explaining why, and was kept locked for 6-7 months. during these months they asked all sorts of documents, and then they closed the account and the rest of the money which was on that account were sent to some strangers :) and again, without any explanations. now, copies of my documents are sitting somewhere on their servers waiting to be hacked and distributed to criminals, who will use them to pass through KYC :)

CryptoPunk7• 5 years ago

>KYC processes are, essentially, the law

They do not apply to all financial interactions. Fortunately they have not yet passed KYC laws that apply to many types of peer-to-peer financial activity, as the ones in force were designed for an era where electronic transactions were only intermediated by large trusted third parties, and largely exempt direct p2p transactions.

So this sudden opportunity to legally engage in financial interactions without the encumberance of 40 years of accumulated AML/KYC laws that has arrived with the emergence of decentralized finance offers the opportunity to reverse the trend toward governments, at the behest of international organizations like the FATF, increasingly resorting to the warrantless dragnet surveillance of finance approach to combating crime, i.e. Total Information Awareness applied to private financial interactions.

Similar to how the internet forced governments to back off on censorship laws, cryptocurrency has the potential to force the political class to rethink current financial crime laws and liberalize people's access to money. It has the potential to lead to criminal laws being limited to those that respect traditional due process and privacy rights, and the principles of freedom of association and presumption of innocence that free societies depend on.

notahacker• 5 years ago

Similar to how the internet forced governments to back off on censorship laws, cryptocurrency has the potential to force the political class to rethink current financial crime laws and liberalize people's access to money.

Or it has the potential to force the political class to rethink current financial crime laws, and tighten up P2P loopholes cryptoenthusiasts are exploiting to make their product more attractive to ransomware developers, to the detriment of everyone else who just wants to avoid photocopying their passport every time they send money to their friends. I wonder which is more likely.

riffraff2• 5 years ago

how the internet forced governments to back off on censorship laws

Did they? Governments regularly censor stuff on the internet all over the world.

bastawhiz2• 5 years ago

Similar to how the internet forced governments to back off on censorship laws, cryptocurrency has the potential to force the political class to rethink current financial crime laws and liberalize people's access to money.

To do this the currency needs to win in a battle against every government without being blocked or made illegal. It doesn't matter what you think about KYC laws: trying to subvert them means taking on governments, and that is almost never a winning strategy. Especially when your strategy is "build a technical system that outfoxes the government by strong-arming them into my way of thinking".

mola• 5 years ago

Don't you know the SV aristocracy are above the law? We can debate the law, we should, not following a law is also a choice. But disrupting laws as an ideology is eroding our ability to engage in meaningful social exchanges. The pipe dream that technology can absolve humanity from unavoidable need for trust and faith is perhaps improving our material situation in the short term. But human psychology is not easily augmented by technology. Deep down, to face the uncertainties and the inevitable lack of full knowledge of reality, we strive for the safety of faith and trust.

Trying to eliminate it will push a massive amount of humans to reactionary action.

And when humans can't get safety out of trust, they get it using force and control.

The art is to balance these, not to imagine you can eliminate it.

BTW: I'm far from being religious. My idea of faith is more abstract than the religious one.

pjc505• 5 years ago

It's worse than that: every reservoir of trust represents a resource that fraudsters can profit from destroying, like a rainforest. It's an opportunity to make money for themselves while gradually wearing down the rest of society and making it worse for everyone else. Just as the deliberate destruction of trust in politics leads to people storming the Capitol.

henning• 5 years ago

I'd rather hold banks, regulators, and governments accountable so that I can safely and sensibly transfer funds rather than having to rely on bullshit nerd Ponzi schemes.

stickfigure• 5 years ago

hold banks, regulators, and governments accountable

Worldwide, historically, this approach seems to have a poor track record.

rohannn• 5 years ago

They're not actually accountable for their actions. History shows this. Fwiw though, I think that stablecoins are pretty much only good for trading pegs and an alternative to international remittances.

dang• 5 years ago

Please make your substantive points without calling names. Perhaps you don't owe "bullshit nerd Ponzi schemes" better, but you owe this community better if you're posting here, because that kind of downgrade causes threads to get significantly worse.

This is in the site guidelines: https://news.ycombinator.com/newsguidelines.html

tptacek• 5 years ago

The web page for this project refers to Altman as the President of YC, but that's a role he hasn't had for quite some time; how up-to-date is this website?

chx• 5 years ago

Rule of thumb: the old bro club + mention of crypto: run like hell.

mastermojo• 5 years ago

The idea is very cool. The criticism against existing cryptocurrencies being too volatile is very valid. I can't help but wonder if this just contributes a "15th" stablecoin to the "14" competing stablecoin standards.

https://xkcd.com/927/

My personal expectation is that the existing frontrunners, Bitcoin and Ethereum, will stabilize in price as the percentage of retail speculators decreases and the percentage of institutional investors + users increase.

xalava• 5 years ago

There are many confusions mixed with stereotypical startup culture in the first video. A global stable currency is not :

- Dollarization, that is an already relatively common phenomenon (Zimbabwe, Argentina...) with controversial effects. Definitely not a silver bullet for hyperinflation.

- A payment system, that requires to work tightly on UI/UX, on cultural preferences, to adapt to local infrastructure... Exactly the reason M-pesa succeeded where many silicon valley startup failed.

And then, there are the technology choices, the stability mechanism, the regulatory aspects ...

pjc505• 5 years ago

One hilarious thing about Tether is that it implicitly acknowledges that the dollar is the source of stability for unstable crypto, and that crypto needs to be "dollarised" to deal with its volatility.

Reserve – A flexible pool of stablecoins designed to reduce risk

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